The dairy industry anchors the provincial economy and is the top income generator in Waikato, Taranaki, West Coast and Southland.
Besides employing 38,700 people on farms and in processing plants, it also provides thousands of jobs in agriculture and forestry support services, wholesaling, veterinary services, and rail transport.
An NZIER report commissioned by the Dairy Companies Association of New Zealand paints a glowing picture of the industry, which generates $17 billion worth of exports. It is the largest exported good, almost three times more than the next biggest, meat.
While horticulture has been a rising star, earnings from dairy dwarf its contribution. If considered as standalone sectors, butter and spreads would be larger than fruit and nuts, and cheese would be larger than either wine or seafood.
Milk processing supports 12,200 jobs.
The report’s findings include:
· Dairy farming has the highest average salary amongst agricultural industries;
· Dairy processing has the highest average salary level of New Zealand’s food manufacturing industries;
· Dairy manufacturing has the 5th highest average female salary level of 138 New Zealand industries;
· Just under 80 per cent of dairy sector wages are earned in rural areas;
· Dairy farming is a top 10 employer in half of New Zealand territorial authorities;
· The dairy sector is a top 10 purchaser of output from around a third of all other New Zealand industries, which collectively account for over 40 per cent of GDP.
In regions like the West Coast, dairy farming is the top income generator.
Dairy delivered more than 10 per cent of GDP, in Waikato, Southland, the West Coast and Taranaki. It is the second largest contributor to economic activity in Northland and Manawatu, and the third largest in Canterbury and Bay of Plenty. About 10 per cent of industry assets are in Maori ownership.
Dairy Companies Association executive director Kimberly Crewther said earnings from dairy were diverse, including products such as infant formula which had grown to being a billion dollar export industry.
She stressed the importance of trade liberalisation, which had reduced tariffs, resulting in New Zealand dairy exports being worth $2.3b higher than otherwise.
Remaining tariffs suppress the value of New Zealand dairy exports by about $1.3b a year.
Victoria University freshwater ecologist Mike Joy said the report would have meant more if it had looked at the pluses and minuses of dairying.
He and colleagues have estimated the costs of cleaning up waterways at billions of dollars a year.
NZIER chief executive Laurence Kubiak said the report had not set out to cover anything but economic impacts.
“Dairying faces hefty challenges on the environmental front, you’ve got emissions and nitrates, but this report demonstrates the fact it’s the mainstay of so many of our regions.”
Solving environmental problems needed to be done in an evolutionary way, or else a lot of things which create value would be destroyed, Kubiak said.
Source: stuff.co.nz
